Prep Agent Flash Cards

Question 1

Appurtenances

Answer 1

Appurtenances
Appurtenances include easements, stock in a mutual water company, covenants, and minerals (still in the ground). They are considered real property and “run with the land.”

Question 2

Reversion

Answer 2

Reversion
The remnant of an estate that the grantor holds after he or she has granted a life estate to another person; the estate will return or revert to the grantor. Also called a reverter.

Question 3

Life tenant

Answer 3

Life tenant

A person in possession of a life estate.

Question 4

Principal

Answer 4

Principal

A main party to a transaction – the person for whom the agent works. Also known as the client.

Question 5

Short sale

Answer 5

Short sale
A sale of secured property that produces less money than is owed to the lender, but in order to expedite the sale and avoid foreclosure expense, the lender releases its interest so the property can be sold.

Question 6

Effective Age

Answer 6

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Flashcards

Standard Policy of Title Insurance

Effective Age
Age of a property based on its condition, not its actual age- for example, if an appraiser examines a building that is 25 years-old but, because of excellent maintenance it has the condition of an 11 year-old building, the appraiser may use the 11-year-old age as the effective age of the property.

Question 7

Standard Policy of Title Insurance

Answer 7

Standard Policy of Title Insurance
Insurance policy most buyers get to protect themselves from forgery in the chain of title or defective delivery of a deed. A standard policy DOES NOT cover a site inspection or a survey.

Question 8

Foreclosure

Answer 8

Foreclosure
A legal procedure by which property used as security for a debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the mortgage document.

Question 9

Debt to Income Ratio

Answer 9

Debt to Income Ratio
How much money a person earns compared to how much they owe, expressed as a percentage. Used by lenders as a loan-qualifying tool.

Question 10

Easement in Gross

Answer 10

Easement in Gross
Easement which attaches to an individual (person or entity). There is no dominant tenement- for example, the power company’s right to access utility lines.

Question 11

Habendum clause

Answer 11

Habendum clause
The deed clause beginning “to have and to hold,” which defines or limits the extend of ownership in the state granted by the deed.

Question 12

Agency

Answer 12

Agency
An individual or corporation who represents another. The other person or corporation is known as the “principal”. A real estate broker does the representing and this relationship is called an “agency”.

Question 13

Extended Policy of Title Insurance

Answer 13

Extended Policy of Title Insurance
Insurance policy with increased coverage. Helps with a dispute over property lines which are disclosed by a survey. Covers improvements on adjoining land.

Question 14

Reliction

Answer 14

Reliction

Gradual recession of water, leaving land permanently uncovered.